One look at the whiteboard in Business Insider’s Manhattan office shows the scale of the company’s ambition. Under the words “World Domination”, a hand-drawn map shows North America, Australia, India and China crossed off – all territories where BI now has offices. Europe is next.
The man plotting BI’s global takeover is co-founder Henry Blodget, whose career could easily be the plot of a Tom Wolfe novel: a former Ivy League tennis ace and star analyst, he was brought low 12 years ago by a federal prosecutor – Eliot Spitzer, later scandal-hit himself – and kicked out of Wall Street. Now Blodget has reinvented himself as one of the kings of digital media.
His desk is easy to spot in the open newsroom. It’s raised so he can spend the day working on his feet. The desks on either side are raised too. “That’s peer pressure for you,” he says. He decided to stop sitting after reading articles on BI’s website about the health hazards. “More Terrifying Facts About How Sitting Will Kill You,” reads one. “ARE YOU SITTING DOWN? Watch Out! Your Job May Be Literally Killing You,” reads another.
The eminently clickable, caps-heavy headlines are typical BI fare. The sort of stories that ComScore calculates brought it 26 million readers a month on desktop and mobile in May – more than WSJ.com’s 21 million. They are also the sort of stories that have plenty of critics worried about the dumbing down of journalism. It works for readers. Traffic in the US is up 48% in the past year according to ComScore. In Britain it has risen 36% although the company doesn’t have a UK office. All that changeson Monday with the appointment of former CBS Interactive vice president Julian Childs as managing director of Business Insider UK, who, along with BI deputy editor Jim Edwards, will now start recruiting a London-based team to cover Europe.
We meet in the boardroom, labelled the War Room. In person Blodget defuses the combative impression left by the standing army of desks and threats of world domination. He is smart, approachable, introspective – a far cry from the old-school media mogul epitomised by the sinister whispering mode of Rupert Murdoch.
In part that’s because he sees himself as in the service industry rather than as a “broadcaster”, and also – like his peers – he has a long way to go to rival Murdoch’s reach. “The rise of social media has changed the way people find information, especially media, fundamentally,” he says. When BI started seven years ago Twitter and Facebook were not ways of finding news. BI could do a valuable service simply by aggregating interesting information in a single place. “When you have a billion people on Facebook each of whom has a customised front page, there is less reason for people to check a website.” Digital media companies need to find that audience, he argues.
The rapid growth of companies like BI, Buzzfeed and Huffington Post suggests they have found that transition easier than many established news players. The mistake many people made with digital media was not to recognise it was new. “Any time a new medium comes along, the existing media look at it and say: ‘Well it’s kinda like what we do and we can do something similar.’ TV is a perfect example of that. At first someone would read a newspaper or act out the radio interview. Then they realised pictures were incredibly powerful. Now 70 years later TV journalism is entirely different to print journalism,” Blodget says.
The same thing is now happening in digital media with the proliferation of new sites – including “explainer” site Vox.com or data whizz Nate Silver’s number crunching FiveThirtyEight – using new ways from video to long-form journalism to interactive graphics to tell stories, he points out. Blodget is also a big fan of Mail Online’s front page, as there is “nothing else like it anywhere, you can’t duplicate it on social media”.
For BI’s critics, however, its main innovation is the slideshow. A series of pictures that tell a story and force you to click through if you want to know more, generating more page views for the website with little real advantage to the reader. The one Blodget got the most stick for was “I Was Quite Surprised By Some Things On My American Airlines International ‘Economy Class’ Flight”, a 28-page slideshow about his discoveries on an economy flight back from Zurich. Sample slide: “I’m not going to say it was[Not] the best pasta I’ve ever eaten, but it certainly wasn’t the worst. Tortellini in cheese sauce. With some tomato sauce, too. And not-terrible steamed broccoli. Bottom line, it was totally fine food.”
To be fair it’s easy to pick a silly story from any news site and BI has reduced the number of slideshows and exclamatory headlines it runs. It has also published impressive long-form articles (one 21,000 word piece on Yahoo’s Marissa Mayer has so far produced 1.2m hits), and established an in-depth, subscription-only service, BI Intelligence, which for $425 a year provides reports into areas like mobile, social media and electronic payments. Everything is evolving, Blodget says, in reaction to what the readers want.
The good news, he adds, is that for all the change some truths are emerging. One is that being advertising-funded works as a business model for journalism – at least for digital companies. BI is lean by old media metrics. It employs just 175 people and expects a significant improvement on last year's $20m in revenues in 2014. It won’t make a profit. All the money is going back into subscriptions and the European rollout.
In the not-too-distant future, Blodget believes there will be a wave of consolidation and a handful of huge digital media companies will emerge with hundreds of millions in revenues employing thousands of journalists. BI has been rumoured to be in sales talks, a rumour he neither confirms nor denies. But he does say that as the market matures, scale will become more important and he sees BI as part of a larger organisation, either as a buyer or one of the bought.
Having once been the poor relation, content is sexy(ish) again. Amazon’s Jeff Bezos is a major investor in BI, he also owns the Washington Post and is just one of a number of tech moguls now interested in content. “Silicon Valley has always been focused on platforms,” says Blodget. “It almost has a pathological need to separate itself from the actual content.” But the pendulum has swung back – a bit – to content, in part because major platforms like Facebook, Google’s YouTube, LinkedIn and Twitter are so well-established and they all need quality content. User-generated content will only go so far, he says, and for professional journalists “it’s a golden age”.
Blodget counts himself very lucky to be witnessing this golden age. In 2002 the then Merrill Lynch analyst lost his job when New York state attorney general Eliot Spitzer published emails in which Blodget appeared to be dissing stocks the broker was selling, calling them “dogs” or POS (piece of shit). He was charged with civil securities fraud, agreed to a permanent ban from the securities industry and paid a $2m fine. Spitzer went on to have his own Bonfire of the Vanities collapse - brought down by a prostitution scandal that derailed a career some had speculated could have ended in a run for the White House.
“Life is very strange. I now refer to Eliot on a first-name basis,” says Blodget. “We have both been through a lot. I don’t think we’ll ever agree about those emails.”
Blodget says Spitzer was right to pursue conflicts of interest within the industry but he still very much disagrees with Spitzer’s interpretation of his emails. “I never wrote a word in a research report that I didn’t believe. And talking about concepts in emails, reacting to things, is quite different to producing a professional opinion.”
“People say that you learn more from tough experiences than easy experiences and that was certainly true for me,” he says. But the scandal was “personally devastating” says Blodget, calling into question the one thing he most prized, the quality and honesty of his judgment.
Spitzer disagrees. He did not return a call for comment but last year he told the New Yorker that the emails showed Blodget’s true feelings and his compromised position. “I thought my professional career was over,” says Blodget. “I decided to spend every day that I had from then on trying to earn back the trust that I had lost … fortunately a lot of people have given me that chance.”
This article was amended on Tuesday 17 June 2014 to reflect the fact that Business Insider made $20m in revenue last year and is forecast to make more this year.
Curriculum vitae
Age 48
Education Phillips Exeter Academy, Yale University (BA, history)
Career 1996 equity researcher, Oppenheimer and Co 1999 joins Merrill Lynch 2003 charged with civil securities fraud and banned from working in the securities industry 2004 contributor, Slate, New York Times, Fortune, Forbes Online, Financial Times and other publications 2007 publishes The Wall Street Self-Defense Manual: A Consumer’s Guide to Investing 2012 ceo/editor-in-chief, The Business Insider